The A-share market sounds another warning bell as these two companies are hand-in-hand designated as ST companies - one involving controlling shareholder fund occupation exceeding 400 million yuan without repayment, the other involving financial fraud from years past.
According to announcements from the Shanghai and Shenzhen stock exchanges, Shandong Hiking International Co.,Ltd. and Shandong Meichen Science&Technology Co.,Ltd. were suspended for one day on September 29th, and will resume trading on September 30th with implementation of other risk warnings. After resumption, the two companies' stock abbreviations will be changed to "ST Xinhuajin" and "ST Meichen" respectively.
**Shandong Hiking International: Fund Occupation Plants Seeds of Trouble**
A fund occupation storm orchestrated by the actual controller has pushed this listed company to the brink of delisting.
The direct reason for Shandong Hiking International's ST designation is the non-operating occupation of company funds by controlling shareholders and their related parties, which failed to be rectified within one month.
Shandong Hiking International recently fell into a serious fund occupation crisis. As of the disclosure date of the 2025 semi-annual report, Shandong Hiking International and its related parties' non-operating occupation of company funds reached a balance of 406 million yuan, equivalent to a considerable proportion of the company's net assets.
The trigger point of this crisis occurred on August 26, 2025, when Shandong Hiking International issued an announcement that evening, disclosing that the company received an "Administrative Regulatory Measures Decision" issued by the Qingdao Securities Regulatory Bureau. Subsequently, the company's stock price plummeted wildly, causing investors to suffer unwarranted losses, thus triggering compensation matters.
According to relevant regulations, when a listed company's funds are occupied non-operationally by controlling shareholders and their related parties, with a balance reaching more than 5% of the absolute value of the latest audited net assets, or an amount exceeding 10 million yuan, and cannot be cleared or rectified within one month, other risk warnings will be implemented.
However, judging from the progress announcements continuously issued by the company on September 10th, September 23rd, and September 26th, Shandong Hiking International Group and its related parties have cumulatively repaid 0 yuan of occupied funds, and the non-operating occupation of company funds balance remains at 406 million yuan, causing the company's stock to meet the conditions for ST designation.
**Shandong Meichen Science&Technology: Five Years of Financial Fraud Results in Penalties**
Unlike Shandong Hiking International, Shandong Meichen Science&Technology's ST designation stems from historical financial fraud behavior.
According to the "Administrative Penalty Prior Notice" issued by the Shandong Securities Regulatory Bureau, Shandong Meichen Science&Technology's annual reports from 2014 to 2018 contained false records, with cumulative inflated revenue of 1.438 billion yuan and cumulative inflated profits of 658 million yuan.
In September 2014, the company acquired equity in Hangzhou Saishi Garden Group Co., Ltd. held by Guo Baifeng and others through issuing shares to purchase assets, making Saishi Garden a wholly-owned subsidiary of Shandong Meichen Science&Technology.
From 2014 to 2018, Saishi Garden inflated engineering construction costs and completion percentages through false procurement of labor services and seedlings, thereby inflating revenue and profits. It also inflated revenue and profits through false seedling sales, false reduction of related expenses, and incorrect recording of revenue and costs.
From the perspective of inflated amounts, the degree of fraud is shocking. 2016 was the most serious, with inflated revenue proportion reaching 24.60% and inflated profit proportion reaching 49.78%. This means that nearly half of the profits disclosed by the company that year were fabricated.
Such fraudulent behavior not only violated securities laws and regulations, but also seriously misled investors' value judgment of the company.
**Investor Rights Protection, Updated Compensation Conditions**
Legal professionals indicate that investor protection mechanisms are the cornerstone of healthy capital market development. As regulatory efforts intensify, the governance level of listed companies continues to improve, and investor rights protection awareness is gradually strengthening.
For investors who have suffered losses, they can protect their own rights and interests through legal channels according to relevant legal provisions.
Shandong Hiking International investors who purchased between May 8, 2025 and August 26, 2025, and sold after August 27, 2025 or still hold shares with losses, can register to join the rights protection action.
Shandong Meichen Science&Technology investors who purchased between March 12, 2015 and March 31, 2025 (inclusive), and sold after April 1, 2025 or still hold shares with losses, can register for compensation claims.
After both companies received ST designation, Shandong Hiking International investors need to closely monitor the progress of major shareholder fund repayment to avoid facing delisting risks due to further deterioration of problems.
Shandong Meichen Science&Technology investors need to pay attention to the company's financial correction and rectification progress, as well as whether future operating conditions will be affected by this incident.
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